June 26 2010 | Dave Gibson : President | Overhead
I wanted to publish our billing policy publicly to be as clear as possible with our client partners about our policies and supporting context. I also want to share this with our community of fellow interactive shops who face the same issues.
The first thing everyone needs to be reminded of is that the interactive world is constantly changing. Its the nature of the Internet. Tell me something I didn’t know right? Although, cliche, this point serves as the ultimate context to our billing policy. There are infinite variables that we cannot control that will affect your website, systems, and modules. The costs associated with reacting to all of these changing variables are those of the client… just as the cost of a new roof or other repairs to a house are the homeowner’s.
One solution that would serve many of our clients is our VIP | Maintenance Program. For $520 you get unlimited training and account management, and 3 hours of maintenance time each month. Although maintenance costs are unpredictable (who knows when the next IE issue will arise), this does provide a comfortable buffer while including all time related to on-going task management.
What Is Billable?
We are a service organization, which like a law or accounting firm, sells hours. We consider ALL time related to the handling and delivery of a client’s request to be billable.
I find that most questions can be categorized as either Maintenance, Warranty, Preference, or Support, so let me address these as such.
Maintenance Items
Start with a scenario of a client discovers that something has changed on their website – either an element’s appearance or functionality has changed. The question is why did this happen, and who should pay to fix it? The context for this scenario and policy, is to first understand that the environment that web software (websites) lives is filled with endless variables which constantly change. The software was written to function at one slice in time for specific browsers, platforms, and servers; so from that point forward changing combinations of variables will likely affect the website. Who should pay for this? Unless the client has a maintenance service plan that covers this, or it is a true warranty item (code error), the client is to pay. Therefore, I recommend enrolling in our VIP | Maintenance Program to start with and budget for on-going maintenance costs that relate to the ever-changing Internet.
Warranty Items
While our contracts have specifically denied any level of warranty, in practice, we have generously serviced both “maintenance” and “warranty” without realizing the difference. “Maintenance” items are the cause of the constantly changing nature of the Internet and not us. These costs turned out to be considerable, yet they were not ours to absorb contractually or otherwise. Therefore, we have narrowed the scope of what we consider to be warranty to “actual code errors expressed only for the specific platforms and browsers specified in the contract at the time of launch”. This assumes the website/application is hosted on our server, and that no custom modifications to the site or application are made. Due to the complexity of these systems, once modifications are made, any resulting issues will extend the billable scope of the task or project.
Subjective Items
There are times when clients believe that an item should be modified at our expense. For instance, a client might say that they believe an item “should” function a different way (“should” being the subjective term).
Through our process we attempt to define functionality as best we can. Needless to say, its difficult to accurately capture functionality through words. Therefore, we offer at least two beta rounds with every website to capture and address subjective preferences. We believe this to be an adequate opportunity to do so, but this requires due diligence on the part of the client to thoroughly review and reveal these items. After signoff/launch of a project, subsequent change requests are billable.
Support
Training or project management time answering questions, providing task/project status, and keeping your tasks organized and on-track is valuable. Without it, a client is left in the dark. Unless a client is enrolled in one of our VIP Service programs, which include these costs, this time should be considered billable.
Scenarios
Q. My site looks funny on IE6
A. IE6 is a non-compliant browser broadly condemned by the Internet and developer communities for its poor security and lack of support for modern web standards. As of June 2010, it appears be used by 7.1% of users. Along with most in our industry, we stopped supporting it. If clients insist, we will do our best to make IE6 work-arounds for additional cost. Because the browser is so poor, we do not warranty anything on IE6.
See: Wikipedia – IE6
See: W3C Browser Stats
Q This feature was in my last website, but isn’t in my new site.
A Refer to the contract first and understand that in the process of negotiation to reach a target budget, features may be dropped. Just because a feature was on a previous site, doesn’t bind us to add it to a new site.
Q. A feature was included in the contract, but didn’t end up on the site.
A. A scenario where new marketing director reviews the site against the contract and asks for it to be added at no cost. Often in the course of a project, there is some horse-trading. Or the client lacks content or cannot otherwise support a features envisioned before, so it is agreeably left out. While we would approach this on a case by case basis, we would lean toward saying that having gone through its beta process and having been approved/launched, the project is closed.
Q. A new browser comes out, and the client’s website no longer functions as it did before.
A. We’d be happy to offer an estimate for how long and how much it will cost to enable the site to display on the new browser.
Q. When editing my website, using propCMS, I get an error.
A. Assuming the issue is a php error, we address as a warranty item at no cost.
Q. Hoping to save money on hosting costs, the client hosts it themselves. Subsequently, there is a display issue, the site is hacked, the site is slow, etc.
A. If we cannot control the hosting environment on which the site runs, or who has access to the code, we can’t be responsible for its performance.
Q. As server upgrade or server-based software upgrade (phpx for example) affects the website. Who pays?
A. In order to stay abreast of performance and security issues at the server level, updates are constantly necessary. While the costs for the updates are now (as of 2009) included in the Systems & Security Program now bundled with hosting, the potential affects of these upgrades is not. Such costs fall under the bucket of maintenance costs associated with the ever-changing nature of the Web. For those on a monthly Maintenance Service plan, we can apply those hours.
two stories here. The first is financial. The second is about roles: Russ has stepped aside and Eric Smith has taken the reigns as chief geek.
As any organization like ours, 70% of our costs are people. Good people. Great people. Painful as it has been for the crew, we’ve cut 6 positions. To no disrespect to those good people, the remaining crew represents the core team as we shift to a more elastic organization with a hub and spoke structure. 
demand for value-added services we’re introducing 8 new service families (next week) designed to add value and efficiency to existing interactive investments. In today’s climate, there’s going to be less investment in extensive web infrastructure, and more in lower cost projects that speak more directly to revenue. Marketing services like SEO, PPC advertising, social – Facebook, Twitter, YouTube, etc engage and drive visitors into revenue paths. Social provides exciting new channels that are cheap and provide a lot of strong opportunity right now. The marketing manager on the client-side is really overworked right now, so we’ll be offering some new support packages to reduce that burden and provide better communication and project transparency. We’re also introducing a lower cost website solution that will include the awesome design we’re known for, but a more standardized set of functionality. Finally as the online marketing spectrum grows more complex, we’re very well positioned to provide the strategic consulting to set the course.
Eric Smith joined us last spring and we soon knew he was the guy to fill Russ’s shoes (he even has dark rimmed glasses!). Eric has the experience in management and system architecture, and a work ethic like nobody I’ve ever met – plus an excellent sense of humor (a must have). He began taking over Russ’s duties in December, and in January became fully in charge of the production team and technical direction for us. Russ still has his equity and is serving in a technical and sales advisory role. Russ, the serial entrepreneur that he is, is pursuing a number of other ventures to include real estate, a new surf cuisine restaurant, and has revived Scully Interactive to develop an ecommerce product.
